Slide 1: Financial Results 2019
Q4 2019 Financial Results 2019 29 JANUARY 2020
Slide 2: Q4 2019 highlights
INTERIM REPORT Q4 2019 Q4 2019 highlights • Revenue grew by 4% • EBITDA up by 6% • Mobile service revenue growth 1.5% • Post-paid churn at the same level, 20.1% (20.1% in Q3) • Post-paid mobile subscription base increased by 36,800 • Fixed broadband subscription base decreased by 8,300 – Excluding c
Slide 3: Growth in revenue and EBITDA
2019 HIGHLIGHTS Growth in revenue and EBITDA Comparable figures CHANGE CHANGE Financials 2019 IN 2019 Operational KPIs 2019 IN 2019 Revenue €1,844m +0.7% Mobile service revenue €824m +1.9% EBITDA €668m +4.4% Mobile subs 4,736,500 +1,6% Fixed broadband EBITDA-% 36.2% +1.3 pp 689,500 +1.0% subs2) Earn
Slide 4: Solid growth despite keen competition
INTERIM REPORT Q4 2019 Solid growth despite keen competition Revenue Mobile service revenue Revenue, €m YoY change.% MSR, €m YoY change,% Increase • 4G up-selling 2,4% 3,5% 1,5% 2,1% 1,9% 2,3% 1,5% -0,4% -2,2% -1,3% • Polystar continues • Equipment sales • Product changes • Mobile services 471 440 4
Slide 5: Solid growth in both segments
INTERIM REPORT Q4 2019 Solid growth in both segments Consumer Customers Revenue and EBITDA1) Revenue, €m EBITDA, €m EBITDA-% Revenue +2% + Mobile and digital services + Equipment sales 38% 37% 40% 35% 36% - Interconnection and roaming prices - Traditional fixed services 296 104 273 105 282 106 295 1
Slide 6: Strategy execution
INTERIM REPORT Q4 2019 Strategy execution Increase mobile and fixed service revenues Grow digital service businesses Improve efficiency and quality 6
Slide 7: Up-selling of mobile subs continues, 5G has started
INTERIM REPORT Q4 2019 Up-selling of mobile subs continues, 5G has started Growth in 4G smartphone penetration Smartphone and 4G speed penetration,% Smartphone penetr.1) 4G speed penetr.2) 4G 50 Mbps penetr.2) • 85% of customers use a smartphone 82% 83% 84% 84% 85% 78% 79% 80% 80% 81% – 98% (96%) 4G
Slide 8: Successful rollout of 5G services continues
INTERIM REPORT Q4 2019 Successful rollout of 5G services continues • Elisa has launched its 5G network in 13 cities • In the capital area, Elisa has one of the largest 5G coverages in Europe, with hundreds of base stations and coverage for over 200,000 people • Elisa was the first operator in Finlan
Slide 9: Expansion of digital service businesses continued
INTERIM REPORT Q4 2019 Expansion of digital service businesses continued Domestic digital services International digital services • Elisa Viihde original series received 13 Venla Award • Several new customer wins for Elisa Smart Factory (the “Finnish Oscars”) nominations and Smart Supply Chain, espe
Slide 10: Outlook and guidance for 2020
INTERIM REPORT Q4 2019 Outlook and guidance for 2020 The positive development of the macroeconomic environment is decelerating in Finland. Competition remains challenging. • Revenue at same level or slightly higher than in 2019 • Comparable EBITDA at same level or slightly higher than in 2019 • CAPE
Slide 11: Financial performance
Q4 2019 Financial performance INTERIM REPORT Q4 2019
Slide 12: Growth in revenue and earnings
INTERIM REPORT Q4 2019 Growth in revenue and earnings EUR million 1) Q4/19 Q4/18 Change % Q4 2019 revenue change YoY, €17m Revenue 487 471 16.7 3.5 % -3 Other operating income 3 1 2.1 236.3 % Materials and services -192 -185 -6.6 3.6 % 10 Employee expenses -81 -80 -0.6 0.7 % Other operating expenses
Slide 13: Growth continues in Estonia
INTERIM REPORT Q4 2019 Growth continues in Estonia • Revenue and EBITDA improved Revenue Revenue, €m YoY change, % 7,2% – Revenue growth +7% 6,0% 6,7% – EBITDA growth +2% 1,2% – Growth in mobile and fixed services, as well as in -3,2% equipment sales – Mobile post-paid base +1,000, pre-paid flat 44,
Slide 14: 2019 CAPEX in line with guidance
INTERIM REPORT Q4 2019 2019 CAPEX in line with guidance • CAPEX €83m, excl. IFRS 16 change CAPEX1) €71m (92) CAPEX / sales1) % 15% 14% 12% 12% 11% – Consumer €54m (57) – Corporate €29m (35) 66 71 51 55 52 • 2019 CAPEX €227m (228) Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 – 12% of revenue – Excluding IFRS 16, in
Slide 15: Solid cash flow continued
INTERIM REPORT Q4 2019 Solid cash flow continued • Q4 cash flow €55m (52, comparable Cash flow and comparable cash flow, €m 58) 102 98 – Positive: higher EBITDA 58 68 55 97 • IFRS 16 impact +€5m 68 52 55 37 – Negative: NWC change and higher CAPEX Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 • 2019 comparable cash
Slide 16: Efficient capital structure and good returns
INTERIM REPORT Q4 2019 Efficient capital structure and good returns • Capital structure according to target Net debt Net debt, €m Net debt / EBITDA – Net debt / EBITDA 1.8x (target 1.5–2x) 1,8 2,0 1,8 1,7 1,8 – Equity ratio 41% (target >35%) 1 184 1 124 1 073 1 068 962 2015 2016 2017 2018 2019 • €18
Slide 17: Increasing dividend 6 consecutive years
INTERIM REPORT Q4 2019 Increasing dividend 6 consecutive years • Dividend proposal €1.85 per share Dividend Dividend per share, € Pay-out ratio1), % Dividend YoY growth – Dividend growth +6% 94% 92% 93% 90% 96% 89% – Total amount €296m 5.7% 10.0% 6.1% – Ex-dividend date 3 April 2020 7.1% 6.1% 1.5% –
Slide 18: Q&A
Q&A
Slide 19: P&L by quarter
APPENDIX P&L by quarter EUR million Q4/19 Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 Q2/18 Q1/18 Revenue 487.3 464.9 451.6 439.7 470.6 453.9 457.5 449.6 YoY growth 3.5 % 2.4 % -1.3 % -2.2 % -0.4 % 0.0 % 2.8 % 8.1 % Other operating income 3.0 0.9 1.1 0.7 0.9 1.8 6.0 1.1 Materials and services -191.7 -172.1 -168.8
Slide 20: Cash flow YoY comparison
APPENDIX Cash flow YoY comparison EUR million Q4/19 Q4/18 Change1) 2019 2018 Change1) EBITDA 168 158 10 661 640 21 Change in receivables -32 4 -36 -20 6 -26 Change in inventories -6 -7 0 -2 3 -5 Change in payables 27 -1 29 17 -30 47 Change in NWC -11 -4 -7 -5 -21 16 Financials (net) -4 -5 0 -21 -17
Slide 21: Cash flow by quarter
APPENDIX Cash flow by quarter EUR million Q4/19 Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 Q2/18 Q1/18 EBITDA 168 179 159 155 158 169 160 153 Change in receivables -32 -2 5 9 4 -23 19 7 Change in inventories -6 -1 -1 6 -7 2 1 7 Change in payables 27 -9 5 -7 -1 2 -5 -26 Change in NWC -11 -12 10 8 -4 -20 15 -12 Fi
Slide 22: Debt structure
APPENDIX Debt structure EUR million at the end of the quarter Q4/19 Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 Q2/18 Q1/18 Bonds and notes 757 943 941 939 767 766 764 763 Commercial papers 133 65 80 10 107 179 267 151 Loans from financial institutions 250 290 290 250 250 200 205 205 Financial leases 1) 96 92 93
Slide 23: Contacts
Contacts: Mr. Vesa Sahivirta Ms. Kati Norppa vesa.sahivirta@elisa.fi kati.norppa@elisa.fi +358 50 520 5555 +358 50 308 9773 investor.relations@elisa.fi
Slide 24: Forward-looking statements
INTERIM REPORT Forward-looking statements Statements made in this document relating to the future, including future performance and other trend projections, are forward-looking statements. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and d